Abstract This paper explores the overall importance of the coffeeindustry to the global economy and describes how fair trade in the industry not only benefits the major players, but the international economy as a whole. It explores the history of coffee prices and how the fair trade movement which guaranteed a negotiated pre-harvest price changed the living standards for disadvantaged coffee growers and workers. The paper concludes that there is a huge disconnect between prices for coffee in the consumption market and the price paid to the coffeeindustry workers which results in poverty and poor economic conditions for coffee growers. Three case study analyses are included.
Table of Contents:
Introduction
Structure and History of the CoffeeIndustry The Fair Trade Movement: Implications for Coffee Workers and the Global Economy
Case Study #1: Starbucks Impact on a Nations Economy: The Duality of Competition
Case Study #2: Cafedirect and KNCU - Partnership in Fair Trade
Case Study #3: Does Fair Trade Affect Quality? - Examining Coffee in Mexico
How has Fair Trade Helped CoffeeIndustry Workers: Tenets and Principles of Fair Trade
Fair Trade Certification Organizations: Fair Trade Labeling Organizations and International Fair Trade Standards
Conclusion: Fair Trade is Ethical Trade
From the Paper "Globalization is a process of enhancing collective measures to integrate economies, not only via goods and services but via governance, investment, trade, and aid (DeAngelis 2004). As globalization has progressed, it is clear that the most advanced countries have gained the most from the integration of economies; as such there is a widening gap between developed/advanced countries and developing/underdeveloped countries. Does globalization favor high-income countries to low-income countries? The coffee industry highlights a common problem with many agricultural products that are marketed within developed regions - impoverished societies characterized poor development trends with a final product that is booming in the industry. Fair trade is the only mechanism that can correct this trend. It should be clear that fair trade is not the savior of the developing region; there are many structural problems that not even free trade can bypass. However, free trade has very visible benefits that have led to changes in sectors of the society (Simmons 2003). The coffee industry has faced many historical processes that have changed the living standards of many producers in the developing region; the free trade movement has helped to create some level of equity as it aids marginalized farmers in the coffee industry."
Abstract This paper begins with a brief look at the history and varieties of coffee and then takes a deeper look at how important coffee is to the economies of the countries in which it is grown. The paper lists the main countries where coffee is grown and then looks at the coffeeindustry in each of those countries from an economic perspective. The paper also describes the types of processing and supply chain management typically used in the coffeeindustry, as well as how coffee is marketed in both domestic and international markets.
Introduction
Importance of Coffee Brazil
The Ecuadorian/Amazon Region
Other Countries
Process/Supply Chain
Marketing and World Trade
From the Paper "According to legend the origins of the coffee industry began when an Arabian goatherd named Kaldi found that his goats reacted strangely around a certain green-leafed bush with red cherries. He ascertained that the excitement exhibited by the goats was due to the effects from eating these cherries. He also consumed some of the fruit and felt "invigorated"; later monks were said to have benefited from the plants qualities to help them stay awake during their long hours of prayer. Whether this story has any basis in fact is unknown but what has been determined is that Coffea Arabica originates from Ethiopia. The plant was cultivated by the Oromom people in the Kafa Province of the country. Arab traders are said to have transported seeds and grew plantations in about 1000 A.D. (Coffee, FAO)"
Abstract This paper examines the history and sociocultural and economic influences of the coffeeindustry and then explains why any investment strategy for the coffeeindustry must consider all of these factors. The paper also assesses the history, production, and problems faced by countries that supply most of the world's coffee, as well as the markets and coffee consumption habits of the countries that consume the most coffee.
Nicaragua
Columbia
France
Hungary
The United States of America
From the Paper "According to TechnoServe (2003) for example, 68 stakeholders from all sectors within the coffee industry have agreed to a collective analysis of the coffee industry in order to determine how best to deal with the crisis. Among these stakeholders are companies from specific countries where coffee has a major impact on the economic and social well-being of their residents. These include Cafecom and Fedecocagua from Guatemala, The Colombian Coffee Federation and Racafe & CIA from Colombia, Nestle USA and the National Coffee Association from the United States, Oxfam International from both the United States and Europe."
Tags: sales, prices, quality, stakeholders, supply, demand, beans, nicaragua, columbia
Abstract This paper explores some of the economic statistics regarding the coffeeindustry, the major and not so major players in the industry, their success rate, the reasons for their success, and the likelihood of their continued success.
From the Paper "The coffee industry seems to be one industry that is recession proof. The demand for coffee has continued to rise in recent years despite struggles by other producers of similar goods. It seems that consumers are willing to pay for small luxuries, such as a caramel macchiato, even during tough times. The coffee business has grown exponentially not only in the United States, but also abroad. Many larger names in the coffee industry, such as Starbucks and Seattle's Best coffee (numbers 1 and 2 according to statistics) have already opened shop in dozens of foreign countries. It is likely that as demand continues to grow, so too will expansion. Large coffee businesses are not the only one's profiting however, from the boom in demand for coffee. Smaller players such as Peet's coffee and Dunn's have also realized growth during the last several years."
Abstract The paper provides a business and industry description for Lavazza Coffee. In particular, the paper examines the key macroeconomic variables that affect the coffeeindustry and hence have an impact on Lavazza's operations; economic growth factors, issues dealing with employment/unemployment statistics, international trade/economics, and inflation. The paper also focuses on employment statistics and the CPI measure of inflation that can affect the coffeeindustry. The paper then evaluates the challenges and opportunities facing the Lavazza company.
Outline:
CoffeeIndustry Competitive Analysis
Challenges and Opportunities
From the Paper "The company concentrates on the domestic market and offers its products throughout the world via a distribution system with subsidiaries, namely London, New York, Paris, and Frankfurt and authorized distributors located in cities around the world. This type of marketing has proven to be successful in the past; however diversifying the target market will leverage Lavazza's name as the best quality coffee and optimize the firm's position in the future and in markets outside of Europe. There is a need to implement marketing tactics that will strengthen Lavazza's household name and reputation."
Abstract This paper examines the potential financial and social benefits that free trade would have on Nicaragua's coffee bean farmers. The paper shows that free trade coffee in Nicaragua is an important part of ensuring the livelihood of the Nicaraguan coffee grower and the continuation of the coffeeindustry. The paper provides a brief history of this coffee growing industry and economic statistics.
From the Paper "On the average Saturday afternoon in Bellevue, WA, the door of the Starbucks at Lohemans Plaza is almost impossible to get through- not because there is a rush on frappiccinos or lattes, but because protestors are blocking the entrance (Ahlers 2002). This small yet dedicated group of protestors is disappointed in many aspects of Starbucks business practices, yet their major problem lies with the issue of fair trade. While this phenomenon is not a common occurrence throughout the country, awareness of fair trade practices, specifically in the coffee industry, has caught the attention of political activists of all ages."
Abstract This paper discusses the issues that a new coffee producer must look at within the changing market dynamics in order to to penetrate the diverse consumption patterns of coffee. The paper focuses on coffee consumption in the United States and Canada. It also analyzes the future outlook for the industry within both Canada and the United States.
Table of Contents:
Introduction
Future Outlook
Consumption Patterns
Statistics about Coffee Consumption in Canada
The Market Analysis
Potential Market(s) in the US
Conclusion
From the Paper "Coffee sales proved the most lucrative for the global hot drinks market in 2005, generating total revenues of $21.2 billion, equivalent to 40.3% of the market's overall value. The market's performance is forecasted to accelerate, with an anticipated CAGR (Compound Annual Growth Rate) of 2.4% for the five-year period 2005-2010 driving the market to an expected value of $59.2 billion by the end of 2010. (Hot Drinks Industry Guide Gives Coffee a Good Future Outlook)"
"Research from the National Coffee Association of the USA says that Coffee drinkers are becoming educated about different varieties of coffee and are increasingly demanding quality in their choices. Even though the coffee market has wrestled with increasing fuel prices as well as green coffee prices, it has been able to pass these costs on to the consumer. Prepared coffee sales continue to outpace packaged coffee sales, becoming more widely available than ever before and many manufacturers of packaged coffee have struggled to grow their market share."
Abstract This paper provides an analysis of the international coffee market, including an explanation of the factors affecting the market, including pricing dynamics, supply and demand and the role of cartel-like behavior among industry associations. It focuses on a article in The Economist magazine (?Drowning in Cheap Coffee?, 9/29/01 ) in which the author offers some background on how coffee's latest price slump came about, explains what some producers ? and producer associations ? are doing about it and suggests remedies for escaping their plight. It draws a comparison between the global coffee market and the world oil market, as both operate according to some of the same dynamics and cartel-like influences. A number of illustrative graphs and charts are included.
From the Paper "Another type of advantage realized by certain growers, not necessarily related to their choice of competitive strategy, is a low degree of operating leverage. By relying heavily on manual labor, a variable cost, rather than large-scale production machinery that entail high fixed costs, farmers across Latin America have been able to quickly scale down production in the face of poor economic conditions. Moreover, these firms likely have lower break-even points than equipment-dependent producers ? that is, they can cover costs even while overall revenue is down, to a greater extent than more mechanized operations. While firms benefit from this kind of operational flexibility, the Economist article points out the other side of the coin: tens of thousands of rural laborers from Mexico to Brazil suddenly looking for work, many begging for food along roadways."
Abstract This paper examines the specialty coffee market. The author evaluates the position and strategy of the company. The paper relates that the company comes under several business headings including roasted coffee, specialty food stores, coffee and tea manufacturing and full-service restaurants.
From the Paper "Diedrich Coffee Inc. is headquartered in Irvine, California and currently has annual sales of $54.60 million. The company produces and sells coffee and also operates a chain of coffee houses. The company comes under several business headings, including roasted coffee, specialty food stores, coffee and tea manufacturing, and full-service restaurants. Coffee shops are nothing new and come in a variety of sizes and types, though the trend recently has been more in keeping with the coffee bar than the full-service coffee shop. Espresso bars are becoming profit centers all over town, including in hotels, and these espresso bars have a language all their own noted in this article, with terms like skinny, short, tall, double, grande, latte, and cappuccino."
Abstract This export plan details the requisite steps that need to be undertaken in order to facilitate the export from Brazil of Brazilian Arabica coffee under the brand Brazilia Arabica and the importation of this product into the United States (US) market. The US market is the largest coffee consuming market in the world measured per capita although these figures have declined from previous highs. The plan further discusses how the US remains such a huge and profitable coffee consuming market since companies such as Starbucks, Seattle's Best, McDonalds, and Dunkin Donuts pushing overall sales of coffee to more than $10 billion. It is estimated that the US market contains more than 100 million consumers of coffee in one form or another.
Abstract This paper examines the reasons why people in New York drink coffee. It discusses the obvious reasons of the punishing pace of New York life which compounds the need for the desired effects of coffee. Some, it expands, are addicted. It also explores the conspicuous traits of many coffee makers, and claims that there are other more profoundly sociological reasons why drinking coffee is a proclivity shared by many New Yorkers.
From the Paper "There are obvious and not-so-obvious reasons why people in New York drink coffee. Some drink coffee (presumably many) because the punishing pace of New York life makes it necessary that they "re-fuel" when the opportunity presents itself. Others drink coffee because they have, to put it simply, an addiction. While these are conspicuous traits of many coffee-makers, there are other, more profoundly sociological, reasons why drinking coffee is a proclivity shared by many New Yorkers. This paper will look specifically at the fact that drinking coffee (in New York and in one of New York's multitudinous cafes) is a social exercise which allows people to find mates, to interact with others, and to protect themselves from harm. Ultimately, what should emerge from this brief paper is an appreciation that coffee consumption is much more than merely a means of "waking up in
Abstract This paper discusses the Second Cup specialty coffee house and the feasibility of purchasing a franchise for Markham, Ontario. This paper examines the pertinent questions that a potential franchisee should consider before buying a coffee house including can the franchisee sell the franchised business and assign the franchise agreement to the buyer.
From the Paper "The Second Cup franchise began in 1975 by opening a small coffee house in a shopping mall in the suburbs of Toronto. In the beginning, Second Cup only sold whole coffee beans, and no drinks or food. After repeated requests from customers for more products and variety, Second Cup soon began brewing and selling their own version of coffee. Today, the company has grown to nearly 400 cafes across Canada. Coffee outlets are placed in malls, office towers, universities, hospitals, and libraries."
Abstract This first year geography paper examines everyday objects and globalization. The paper focuses on coffee which was tracked through global processes. The paper examines the idea of coffee as a third world product sold in developed countries.
From the Paper "Coffee was chosen for this assignment because it is a food product that can be found in almost every household, apartment or university residence. Coffee is also involved in a complicated growing, processing and distribution process that moves from developing countries to developed countries. The conditions in which coffee is produced often demonstrate the negative consequence of globalization. For all of these reasons an examination of the coffee industry is very important for an understanding of the labour, trade and consumption patterns that have resulted from globalization. Coffee: A Geographical and Social Analysis Coffee is an ideal object to study globalization."
Abstract This paper looks at how Starbucks is combating an increasingly negative image, which neither its campaign for social responsibility nor its highly publicized charity and philanthropic activities have been able to negate. It explains that the negative image did not emerge from activities or strategies directly associated with the corporation, but with conditions plaguing Guatemalan coffee farmers.
From the Paper "In early 1995, the U.S Guatemala Labor Education Project, a human rights group based in Chicago, reported that Starbucks' Central American suppliers were underpaying workers. Wages on the farms were about 33 cents per hour. Although, Starbucks does not own the plantations, UGLEP has threatened public protests unless the company uses its leverage to improve conditions (Simons 44). In October 1995, Starbucks drew up a code of conduct for the farms, but a year and a half later, "the conditions are still rotten, " says Rhett Doumitt, a UGLEP staffer based in Guatemala. Starbucks says that it commissioned a study of the Guatemalan farms to test the feasibility of enforcing standards (Simons 44). To date, it has done little to actively improve conditions despite claims of trying."
Abstract This paper explains that the autobiography "Three Kilos of Coffee" is a memoir by Afro-pop musician Manu Dibango that covers the development of his musical career and his search for identity. The author points out themes of the book. The paper relates Dibango's viewpoint.
From the Paper "Jazz saxophonist Manu Dibango is the first African musician ever to record a top xx hit as well as the most influential artist of Afro music. His autobiography "Three Kilos of Coffee" reveals his musical life, the impact of his multicultural background and his ..."
